Tax research

The Internal Revenue Service should make several changes in its electronic filing system to address concerns raised by the American Institute of CPAs and others, according to two new reports.

A Russian appeals court has given PricewaterhouseCoopers' Russian firm the right to appeal a tax evasion case involving the firm's audits of the bankrupt Yukos oil company.

Vertex has acquired Levyti Consulting's Global Tax Office software and plans to market the product with its own global income tax and compliance systems.

More than 27,000 health care providers who were paid by Medicare had unpaid payroll and other federal tax debts totaling over $2 billion in 2006, according to a study by the Government Accountability Office.

The Internal Revenue Service is trying to cope with rising gas prices by increasing the optional standard mileage rates that taxpayers can use to calculate the deductible costs of operating an automobile.

The late comedian George Carlin had a $3 million tax debt that took him about two decades to pay off, but he credited the debt with keeping him working as a comic.

The Internal Revenue Service has waived some limitations of the low-income housing tax credit in Indiana and Iowa so that owners of facilities in these states can provide housing to victims of recent storms and flooding.

Questions about economic stimulus payments and tax rebates kept the phones buzzing at Internal Revenue Service offices and cost the IRS a considerable chunk of its budget.

Calculations of economic stimulus payments by the Internal Revenue Service may have been wrong in nearly 400,000 cases.

The Internal Revenue Service said that about 5.2 million retirees and disabled veterans who qualify for economic stimulus payments have not filed to claim the payments.

A former UBS banker, Bradley Birkenfeld, pled guilty to conspiring with an American billionaire real estate developer, Swiss bankers and co-defendant Mario Staggl to help the developer evade paying $7.2 million in taxes by helping him conceal $200 million of assets in Switzerland and Liechtenstein.

Milwaukee Brewers first baseman Prince Fielder reportedly owes the Internal Revenue Service a tax debt of $409,149, and the IRS has filed a lien against him to collect it.

Charles Merrill, a self-made millionaire and cousin of the co-founder of Merrill Lynch, could end up serving three years or more in jail for not filing income taxes since beginning a tax protest in 2004.

A group of eight midsized CPA firms has banded together to offer cross-border tax services in an effort to compete with larger firms.

The House Ways and Means Committee has passed a bill aimed at forestalling the spread of the alternative minimum tax for another year.

The Internal Revenue Service has granted an extension to victims of the Midwest floods so they will have more time to make their quarterly estimated tax payments.

JK Harris, a firm that advertises its ability to help taxpayers solve their problems with the Internal Revenue Service for pennies on the dollar, has agreed to pay $1.5 million in restitution to former clients and change its advertising as part of an agreement with attorneys general in 18 states.

The Research Claims Audit Techniques Guide: Credit for Increasing Research Activities Section 41 just released by the IRS is a great roadmap for practitioners of what to expect on an audit. Although the research credit has not been extended, it is expected to be. This guide issued by the Large and Mid Size Business Division (LMSB-04-0508-030) really shows how IRS will scrutinize research credit refund claims (RC claims), which have been designated a Tier I Issue, which in turn means they are of high strategic importance to LMSB and have significant impact on one or more industries. The guide is particularly geared toward those prepared under the most common approach being used, prepackaged RC claim studies. How those studies are typically done is explained in detail, as well as the potential problems that IRS sees with them. Eustace, T.C. Memo 2001-66, aff’d 312 F.3d 1254 (7th Cir. 2002) is cited as presenting a typical research credit claim involving an accounting firm study and a prepackaged submission. This is an extensive section in the guide on how an auditor should go about evaluating RC study-based claims and specific advice that an information document request (IDR) should be made for the engagement letter from the outside consultant conducting the study. Even the accompanying exhibits have great information, such as a 19-step checklist that the auditor should follow when reviewing the claim, a comprehensive mandatory research credit claims IDR, and even a check sheet to help deal with computational issues. I don’t get excited by every audit technique issued, but this captured my interest because it reminded me of a guide IRS put out a number of years ago on cost segregation. That guide was used by some practitioners as a blueprint on how to successfully conduct a cost segregation study that would withstand IRS review. Both that and the latest guide illustrate that as more professionals utilize studies as significant revenue generators by justifying the fees charged as a small percentage of the tax benefits obtained, IRS will adopt a uniform policy with regard to them. There is a great benefit to this as the audit technique guide is very informative and explains exactly what won’t and will pass IRS muster.

The Internal Revenue Service violated some of its own legal requirements in some of the seizures of taxpayer property it conducted in the past two years, according to a new report.

MSNBC host Keith Olbermann was on the receiving end of a tax warrant from New York State charging him with $2,269.50 in back taxes for his Los Angeles-based business, Olbermann Broadcasting Empire.